North Sea producer EnQuest's share price jumps despite losses more than doubling

Jessica Morris
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(FILES) File Photo taken in the North Se
Osborne unveiled tax relief for the North Sea yesterday (Source: Getty)

EnQuest said that government changes to the way oil field operators are taxed for decommissioning costs will spur deals in the North Sea.

"The tax changes facilitate late-life asset transfers because decommissioning tax relief is a big part of the transfer," Jonathan Swinney, EnQuest's finance chief said.

"Over the medium term it will be positive," he added.

Chancellor George Osborne announced oil field operators will be given tax relief on decommissioning costs when they sell an asset in yesterday's Budget.

It comes as EnQuest reported a loss of about $1.3bn (£930m), up from a loss of $579m in a year earlier.

The company was forced to stomach a $626.2m impairment charge to its oil and gas assets as a result of the price rout.

Despite this, its shares jumped as much as 25.9 per cent to 18.25p per share in mid-morning trading.

Oil companies such as EnQuest have been hurt by the price of their main product tumbling since the middle of 2014. They've been forced to cut costs, halt or abandon projects and axe jobs.

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